Collecting on Business Debts

It can be very frustrating to manage your company’s daily operations while waiting for much-needed and overdue payments. Unfortunately, even if you are very careful about choosing the people with whom you do business, delayed payments are very likely to happen sometimes. When this occurs, it is important to understand all of your options.

Sometimes it is necessary to take legal action against parties who break contracts or fail to repay the debts they owe you. In a situation like this, effective legal counsel can be a valuable part of your action plan. To schedule a consultation with Your Iowa Lawyers of LaMarca & Landry, P.C., call 877-327-2600.

Debt Collection Strategies

Of course, sometimes a check will be a day or two late or there may be some minor complication with a customer’s bank or the postal service. However, if sufficient time has passed and you still have not received payment, it may be time to start considered tactics like the following:

• Contact the customer directly – A polite letter detailing the amount owed and the due date may be the only reminder that your customer needs. If you prefer, you can call the customer to discuss the matter and find out what is going on. If you choose to contact a customer, however, make sure you know and obey the federal laws concerning creditor harassment.
• Small claims court – If you have written evidence of the service you performed or product sold, as well as evidence that you have not received payment, you may want to take the customer to small claims court. However, this is often a lengthy process that can entail steep court fees. If you are considering this option, make sure the payment you might receive is worth the time and expense of pursuing it.
• Debt collection agencies – If you have several customers who are not making their payments, you may want to sell their debts to a collection agency. You will receive a large portion of the money you are owed, and the collection agency will take on the task of pursuing the full amount owed. (The difference between the full amount and the percentage you receive is the agency’s source of profits.)

Before making any big choices that could affect your business’s income, you may want to discuss your situation with an Iowa business attorney. He or she will be able to evaluate your situation and provide efficient representation while you pursue the amount you are owed.

Contact Us

The attorneys at LaMarca & Landry, P.C. are experienced Iowa business lawyers committed to excellent service. Contact our offices at 877-327-2600.